Business Meal Deductions Are Changing: What Employers Need to Know Before 2026

Currently, meals provided on business premises for the convenience of the employer are 50% deductible. But starting January 1, 2026, these meals will become 0% deductible—a complete phase-out of this long-standing tax benefit.

To qualify under the current rules, meals must:

• Be provided on the employer’s business premises (e.g., in a company cafeteria).
• Be offered for the employer’s convenience (e.g., to keep employees on-site for emergencies or demanding schedules).
• Be properly substantiated with records showing the business purpose and number of employees served.

These deductions will no longer be allowed after 2025, so now is the time to review your policies and prepare for the change.

Not all meal deductions are disappearing. Here’s what remains unchanged:

• 50% Deductible:
  • Meals with clients or prospects, as well as meals while traveling for business, as long as:
  • The expense is ordinary and necessary.
  • The taxpayer or employee is present.
  • The meal is not lavish or extravagant.
  • The food is invoiced separately from entertainment.

• 100% Deductible:
  • Company-wide events like holiday parties or summer picnics.
  • Meals made available to the public.

Whether you’re a small business owner or managing a large team, these changes could affect your bottom line. If your company regularly provides meals to employees on-site, it’s time to reassess your strategy.

At Froehling Anderson, our team of experienced CPAs is here to help you navigate these updates.

We’ll work with you to:

• Evaluate your current meal policies.
• Maximize remaining deductions.
• Plan ahead for 2026 and beyond.

Tax law is always evolving, and proactive planning is key. Our Minneapolis and St. Cloud based CPAs are here to support your business every step of the way.

Contact us today to schedule a consultation with one of our expert accountants!

The information provided here is accurate at the time of publication but may change as laws and regulations evolve. While Froehling Anderson aims to share accurate, timely information, we encourage you to reach out to your relationship manager for guidance on your specific situation.